"We're at the center of three IT trends," said Diane Greene, co-founder, president and chief executive officer of VMware. "One is the need to deliver managed services on Intel servers with mainframe-class quality and Internet speed. Another is a computing environment that is complex, with an incredible number of incompatible hardware platforms, operating systems and applications. And the third is growing pressure to meet these challenges without increasing IT budgets or adding staff.

"With VMware, you can create a uniform software platform for delivering applications and services on Intel servers that factors out hardware and operating system differences and simplifies deployment and management," said Greene. "That's of huge value to service providers and enterprise IT."

VMware was founded in 1998 and delivered its first product - software that enables Intel desktop computers to run multiple operating systems simultaneously - in May 1999. VMware has more than 500,000 registered users including 5,000 corporate customers in 100 countries. Today marks VMware's expansion into server markets estimated at $7 billion or seven times the size of its current markets by 2004, according to industry analysts.
*

The MultipleWorlds Advantage

VMware's software is based on the company's patent pending MultipleWorlds technology, a thin software layer that sits between the Intel architecture and the operating system, virtualizing the hardware and managing all hardware resources. MultipleWorlds technology combines the principles of classic virtual machine technology with advanced virtual networking and mainframe-class system and resource management capabilities.

With MultipleWorlds technology, users create virtual hardware environments, called virtual machines, each of which runs its own separate operating system. Users can run different operating systems or multiple instances of the same operating system depending on their requirements. MultipleWorlds' virtual networking, system, and resource management capabilities enable them to dynamically allocate and manage resources across virtual machines at any granularity.

With MultipleWorlds technology, users in server environments can:

Consolidate Servers
Because many virtual machines can run on a single server, the number of computers required to perform the same workload is dramatically reduced. This saves on hardware costs, floor space, and IT fixed skills costs because fewer physical machines cost less, take up less valuable real estate, and are easier to manage.

Rapidly Provision Servers, Test, and Deploy New Applications and Services
Because virtual machines can be copied and moved from one machine to another, users can provision new instances of applications and services instantly and remotely, saving time and resources. In addition, test set up is faster and doesn't require as much hardware, and replicating test environments is trivial so tests can scale quickly. Once testing is complete, users can deploy new applications and services with complete confidence because they are deploying the exact tested image. And, in the event of an operating system crash, archived images can be quickly restored, reducing downtime, lost data, and end-user productivity losses.

Build, Scale and Manage a Complex Infrastructure Quickly and Easily
With MultipleWorlds technology, users can create a uniform platform on top of diverse and incompatible hardware, factoring out hardware and operating system differences and creating standard server environments. This greatly simplifies application and service deployment, management, maintenance, and support. Also, by cloning and instantly deploying new virtual machines, organizations can deliver capacity on demand without physical set up. This can result in dramatic improvements in the quality of service to end users or in the case of service providers, the ability to add new customers, applications, oservices in minutes.

Achieve Mainframe-class Management and Control
With MultipleWorlds technology, users can dynamically allocate resources across virtual machines at any granularity, providing a level of system and resource management unmatched in even high-end enterprise server environments today. In addition, users can implement mainframe-class failover and redundancy more flexibly and far less expensively because it all can be done in software. And because virtual machines are isolated and protected from one another, users can implement finely tuned security policies.

More than 120 Companies Evaluating VMware's ServeProducts

VMware launched a beta program for select customers eight weeks ago and to date more than 120 companies have signed up to evaluate VMware's new server products. Among the first to install and begin testing the products are CenterBeam, eOnline, Merrill Lynch, and Pro Tier.

"The strong initial response to our server products from some of the most demanding IT customers in the world gives us great confidence in our ability to be successful with our server products in broader markets," said Greene.

Specifications, Pricing and Availability

VMware will ship a version of the GSX Server that runs on servers with Linux operating systems in January 2001 and a version of GSX Server for servers with the Windows NT operating system in the second quarter of 2001. Both versions of the GSX Server enable customers to deploy Windows and/or Linux operating systems in virtual machines. GSX Server is priced at $2,499 for a single license purchase and will be available directly from VMware and from selected resellers and distributors. Initial support is required to purchase GSX Server and ranges from 10-25% of the gross license fee, depending on which support option customers choose. Usage-based pricing is available for service providers using GSX Server to deliver hosted applications and services to their customers.

VMware will ship ESX Server in limited quantities in the first quarter of 2001. ESX Server does not require a host operating system and can also be used to deploy Windows and/or Linux operating systems in virtual machines. Usage-based pricing for ESX Server starts at approximately $20,000 per month. Initial support is required to purchase ESX Server and ranges from 10-25% of the gross monthly fee, depending on which support option customers choose. Licensed-based pricing for the ESX Server will also be available at first customer ship (FCS).

For a complete list of product features, specifications and system requirements visit VMware's Web site at
http://www.vmware.com, or to sign up for VMware's server beta program, email
Sales.

About VMware

VMware is a leading provider of software for delivering managed services on Intel computers safely, reliably and on demand. VMware's customers include service providers, enterprise information technology groups, and technical professionals. Founded in 1998, VMware delivered its first product - software that enables Intel desktop computers to run multiple operating systems simultaneously - in May 1999. VMware has more than 500,000 registered users including 5,000 corporate customers in 100 countries. VMware is a privately held company based in Palo Alto, California. For more information, please visit the Web site at
http://www.vmware.com.

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(c)2000 VMware, Incorporated. All rights reserved. VMware, the VMware boxes logo, MultipleWorlds, GSX Server, and ESX Server are trademarks of VMware, Incorporated. Microsoft, Windows, and Windows NT are registered trademarks of Microsoft Corporation. Linux is a registered trademark of Linus Torvalds. All other marks and names mentioned herein may be trademarks of their respective companies.

*VMware derived it market size projection from server market forecasts by Forrester Research Group and International Data Corporation (IDC).